---

Small and Medium-sized Businesses

My Lords, I, too, thank the noble Lord, Lord Harrison, for raising this debate, which gives the House the opportunity to debate medium and small businesses. Despite all the regulations referred to by other noble Lords, I feel confident about this debate because I know I have a good story to tell, as I speak of the Caribbean black businesses. I am a patron of the European Federation of Black Women Business Owners set up by Miss Yvonne Thompson CBE. At present, the register is about 15,000, and we suspect that the number of millionaires is around 800 and rising. The birth of the black business sector is fairly recent but nevertheless remarkable. First-generation migrants saw education as their most important goal for their children. By the 1970s, it was becoming increasingly obvious that an economic base was critical for sustainability. There was much discussion among the community, seeking ways to bring this about. Several conferences were held and many attempts at niche businesses began slowly to appear, using the skills already in the community to facilitate entrepreneurship. The biggest problem was finance. I recall one conference at which a young bank manager said that he,"““did not lend money to black people on principle””." We never heard what the principle was. Despite such amazing arrogance and many obstacles, the present-day story is one of success. A study by the London Development Agency found that 8 per cent of British black women have an interest in starting their own business. The range of businesses is also significant, from funeral directors to radio station owners, hairdressers to PR consultants, care homes to retail shops. There are also many builders. The list is endless, both niche and mainstream. The Government’s objective of increasing small business is reflected in London by the LDA’s enterprise programme, which includes a range of activities at various levels to support small businesses. Sarajeet Soar, in an article in 2001, written for the book, Community Economic Development, noted that national programmes to promote ethnic minority businesses are reactive, ill-conceived and badly targeted. That may still be so, but the European Federation of Black Women Business Owners has accepted that the Government can only do so much and is acting as an enabler itself. It organises events that connect and inspire minority businesses, such as breakfast meetings, conferences and award ceremonies, the object being to explore and explain government initiatives. Business networks are formed to support both existing and potential businesses. There is also training for business advisers, providing tool kits to access finance through the Government’s small business schemes and to encourage banks to be more flexible. Micro-finance and business enterprise has helped entrepreneurs to break out of a real poverty trap, enabling them to provide better living standards for their families and home ownership away from the run-down estates of first-generation migrants. The United Kingdom has benefited from the competitive advantage of diversity. Productivity has been enhanced. The United Kingdom is able to sustain a key role in terms of both the national and international economy. There is now empirical data to show that diversity and economic strength are interrelated, on which the Minister might like to comment in summing up. However, some problems are still around. We need policy makers to realise that it is both useful and appropriate to treat certain groups as a special category—such as in horse racing, where handicaps are quite normal, I believe. It is clear that there is need for special business support, and that it is greater in some ethnic communities than in others. On the question of finance, it is accepted that black minorities are not now disadvantaged in terms of start-up capital from banks and other formal sources. This applies to their propensity to raise some finance from their own communities. The African Caribbean community still has less success in accessing bank loans to expand its businesses. In view of that, it would seem that the Government need to make African Caribbean black entrepreneurs a greater area for proactivity in sustaining their businesses in the second and third years of trading. Despite these many remaining obstacles, I believe that the Government have done well. I am quietly confident that this country will see a growth of entrepreneurship among the younger generation aided by technology and that it will sustain diversity as a business asset within the United Kingdom.